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- The Wholesale Price Index (WPI) is the price of a representative basket of wholesale goods.
- Some countries (like India and The Philippines) use WPI changes as a central measure of inflation.
- However, United States now report a producer price index instead.
- The Wholesale Price Index focuses on the price of goods traded between corporations, rather than goods bought by consumers, which is measured by the Consumer Price Index.
- The purpose of the WPI is to monitor price movements that reflect supply and demand in industry, manufacturing and construction. This helps in analyzing both macroeconomic and microeconomic conditions.
- In India about 435 items were used for calculating the WPI in base year 1993-94 while the advanced base year 2004-05 uses 676 items. The indicator tracks the price movement of each commodity individually. Based on this individual movement, the WPI is determined through the averaging principle.
